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Investors may be or may not be aware that Eros International Plc (NYSE: EROS, US$13.84, “EROS”) is presenting consolidated financial statements purportedly audited by Grant Thornton India LLP (“Grant Thornton”). In actuality, the audit is a conflation created by Grant Thornton of at least six different auditors, most of them unknown, and at least four of them are not registered with the Public Company Accounting Oversight Board (“PCAOB”).

EROS reports its consolidated financial statements on a parent that is audited by one auditor (Grant Thornton) who does not audit its principal subsidiary, Eros International Media Limited (“EIML”), listed on the National Stock Exchange (“NSE”) in India (NSE: EROSMEDIA, INR205.70).

EROS has at least 23 subsidiaries and step-down subsidiaries. EROS does not disclose if Grant Thornton actually audits any of these other subsidiaries, and does not file an audited parent only statement. Therefore, investors cannot know the scale of the EROS assets that Grant Thornton actually reviews, which presents another significant concern.

it does not review the interim financial results of twelve subsidiaries and step down subsidiaries included in the Statement” and that it does not “audit the financial statements of twelve subsidiary companies.

The figures referenced above are sourced directly from EIML’s filings with the NSE and EROS’s quarterly earnings releases filed with the U.S. Securities & Exchange Commission (“SEC”) containing disclosures for the nine months ended December 31, 2015, 2014 and 2013.

Another unnerving curiosity is that until October 2015, EIML publicly disclosed the audited financial reports of these subsidiaries on its investor relations page (web archives and also saved in an asensio.com). However, during November 2015, these reports were removed, raising yet more concerns around the increasing opacity of EIML’s financials and the integrity of EROS’s audit itself. Investors should note that this action by EIML, and thereby EROS, came about after the public allegations were made against them.

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